1. The Great Depression
Causes Review

2. Problems during the “Prosperous” 1920s
Farmers had too much livestock and food to sell
Railroad, textiles, and steel industries losing business toward end
Mining and lumber not in as much demand
Consumer industries slowing
New forms of energy and transportation meant decline in formerly major industries

3. Farmer Problems
Farmers did very well during WWI, so they bought new equipment and developed ways to make A LOT of their crops
Now farmers aren’t selling as much, and they can’t pay off their loans
Small town banks begin to fail due to lack of being paid back (no money to give out when they aren’t getting it in)

4. Resolution? McNary-Haugen Bill
Government intervening in the farm industry to buy up extra crops and sell them to other countries.
Was vetoed twice

5. Consumer Problems People not buying as much
Credit debt
No rise in pay
Uneven Distribution of Wealth
Rich getting richer
Poor getting poorer (70% earning less than $2500 a year)
Only ½ of houses have electric lights
Many people too poor to pay for all the glitzy new items of the 1920s

6. The Election of 1928
Hoover was the secretary of commerce and had a decade of wealth under Republicans backing him up
“We in America are nearer to the final triumph over poverty than ever before”
Hoover won by a landslide

7. The Stock Market Stock – you buy a “share” of a big company
You invest in their company, they share the wealth.
The better the company does, the more you get in return, so the more expensive the stock
Dow Jones Industrial Average
Thermometer of stock market (how some of the top 30 companies are doing based on what their stocks sell for)
In the late 1920s, stocks keep rising, people making money, others get excited about buying shares

8. How the Stock Market Works
Stock Market Then and Now
Read “Now and Then: New York Stock Exchange”
Page1321 in textbook

9. Disaster Many people hoped to get rich quick on stocks
Buying on Margin – putting down a down payment and borrowing rest of money for the stock
Stock prices went up and up but companies weren’t necessarily doing any better
BLACK TUESDAY
Prices started dropping on stocks, so people frantically tried to sell theirs off before they lost any money
People who bought on margin were stuck with huge debts

10. Black Tuesday

12. Finish Taking Notes
“Financial Collapse” pg
Take NoTeS
Look at the interactive features
Take the Quiz
WRITING
[In Synthesis Paragraph portion of notes]
summarize by answering Critical Thinking Question #3.